Shriram Finance share price jumped 5% intra-day after the company posted a strong set of numbers for Q2FY26. The NBFC reported 11% year-on-year (YoY) rise in Q2 net profit. The Net interest income (NII) grew nearly 10% YoY in Q2FY26, while pre-provision operating profit (PPoP) rose by a similar 11% YoY this quarter.
Following the result, brokerage houses like Motilal Oswal and Nuvama reiterated their bullish stance on the stock and expect nearly 15% upside from current levels. Let’s take a look at what is their say on this stocks –
Motilal Oswal on Shriram Finance
Motilal Oswal maintained its ‘Buy’ rating on Shriram Finance with a target price of Rs 860. This translates to an upside potential of about 15% from current levels. According to the brokerage report, “We raise our FY26/FY27 estimates by 4%/3% to factor in higher NIM, lower operational expenditure, and credit costs.”
The brokerage believes the company is well-positioned to benefit from its diversified asset mix, improved access to funds, and strong cross-selling opportunities.
Motilal Oswal also noted that a potential strategic partnership could further strengthen the company’s balance sheet and improve its case for a credit rating upgrade.
The brokerage highlighted that Shriram Finance’s quarterly performance exceeded expectations. “NIM improved sequentially, supported by a reduction in surplus liquidity, while S2 assets surprised positively with a 35 bps QoQ improvement, which kept credit costs well contained,” it said.
It added that the company is effectively using its large customer base for cross-selling new products, which could help sustain growth and support operating margins in the coming years.
Nuvama on Shriram Finance
Echoing a similar view, Nuvama Institutional Equities also reiterated its ‘Buy’ call on the stock while raising the target price to Rs 870 from Rs 710 earlier. This implies 10% upside from current levels. The brokerage cited lower credit costs, improving net interest margins (NIMs), and consistent growth as the key positives driving its optimism.
Nuvama also took note of the recent senior management changes, describing them as part of the company’s routine succession plan. The firm said the immediate focus areas include reducing the cost of funds (CoF) and enhancing productivity by limiting branch expansion and headcount additions.
Nuvama said the company’s credit cost of 1.9% was stable sequentially and below its guided range of 2–2.2%.
The brokerage also highlighted that gold loan stress was temporary as customers were given more time to repay. “Shriram Finance caters to MSMEs in the services sector where most segments fared well on asset quality except provision stores that are seeing stress,” it said.